Understanding the IRS Transcript Code 971
When reviewing your IRS transcript, you might come across various codes that provide information about your tax status and any actions taken by the IRS. One such code is 971. Here’s what it means and how it might affect you.
What is IRS Code 971?
Code 971 is used by the IRS to signify that a specific action has been taken regarding your tax account. It often indicates that there is a notice or a change related to your tax return that has been initiated. This code usually appears alongside a description or explanation of the action taken.
Possible Reasons for Code 971
Here are a few scenarios that might trigger IRS code 971:
Amended Return: If you filed an amended tax return, the IRS may use this code to indicate that they are processing this change.
Verification of Information: Code 971 may indicate that the IRS is conducting a review to verify information on your tax return, which could be in response to discrepancies or random audits.
Adjustments or Corrections: If there were adjustments made to your tax refund or account balance, this code could appear to inform you of these changes.
Notice Sent: The code may also indicate that a notice regarding a specific action has been mailed to you, which could include requests for additional documentation or explanations about adjustments made to your tax.
What Should You Do If You See Code 971?
Check the Description: Look for additional notes on your transcript that accompany the code. These often provide further details about what action has been taken or what you need to do next.
Review Any Notices: If the IRS has sent you a notice, read it carefully for instructions or explanations regarding your tax situation.
Contact the IRS: If you are unsure about the meaning of the code, or if you believe an error has occurred related to your account, you may consider contacting the IRS directly for clarity.
Conclusion
IRS code 971 serves important functions in communicating actions taken on your tax account. Understanding its implications can help you address any potential issues and ensure your tax records are accurate. Always keep an eye on your IRS transcript for updates or changes that may require your attention.